Here's How To Get Fast Cash For Your Business... Without Loans - Without Debt!!

Yes! Believe it or not, you can get cash for your business without going into debt.

There are companies out there that will actually give you cash for your invoices.

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New to Factoring?

For those who aren't familiar with factoring, it is basically a fast way to get cash to run your business.

Factoring is Not a Loan

When you send your customers an invoice, they usually have 30 days to pay you back. Factoring companies will give you the bulk of the cash up front, sometimes within 24 hours, and collect the payments from your customers themselves. Once the invoices are paid in full, you’ll get the balance left over, minus a small fee.

Factoring Doesn't Require Debt

So how do you go about choosing the best factoring company?

Not all of them are created equal. Not all of them will give you the same level of service you need to help grow your business.

Everyone claims they have the simplest rate structure in the industry, no long-term contracts, same day funding, no up-front fees, no monthly minimums or maximums, etc., etc., etc.

We also offer these same benefits, but we GO THE EXTRA MILE FOR YOU that other factoring companies don’t.

Here’s Why We Are The Factoring Company You Need For Your Niagara Falls Business

No other factoring company matches our level of superior service and offerings.

Financially Strong

We have been in business since 1979, are privately held, and have a proven track record of being financially strong. We have survived many economic downturns and in doing so, can help you through any difficult times you might encounter. We won’t go out of business when the times get tough, like some other factoring companies regretfully have in the past.

Part of a Vast Network

Every factoring company has a preference for size, industry, and risk. It’s impossible for you to know which company is the best fit for you. By contacting us, we can save you a tremendous amount of time by helping you find the best match for your business - whether it’s with us or another company.

We have a vast network of industry colleagues that we’ve built over 20+ years in the business. So, when you take the time to explain your needs to us, we can be the “one stop shop” to help you find exactly what you’re looking for.

No Minimum

Most factoring companies will allow you to pick & choose customers to factor, however they usually have a minimum amount before they’ll work with you. With us, you can pick & choose what to factor on an invoice by invoice basis with no minimum.

Our factoring agreement is like carrying a credit card in your pocket. You carry it to use when you need it but don’t sign an agreement which will force you into factoring when you don’t need it.

Transparent Fees

Most factoring companies are not upfront about their fees. We are different. We are totally transparent about our fees. When you apply, you are provided a transparent, no obligation rate proposal with the fee for your company.

Our typical contract term is 90 days and we offer price breaks for extended term contracts as well as volume discounts. Optional services include $7/ACH for next-day funds sent electronically to your bank account or $12/wire for same-day funds. Invoices can be scanned and electronically uploaded directly to our secure server for $9/batch. In instances when original invoices are required, we offer discounted rates with Federal Express to submit your invoices.

That’s it! See which other factoring company, if any, will be totally up front with their fees before they try and get your business.

Higher Advance Rates

An “advance” rate is the percent of the invoice face value that you’ll receive upfront. Industry average advance rates are 70-90% of the face value of the invoice. So, for example, if your customer owes you $1,000, you should expect to receive an advance payment of $700 to $900 to your account. Our typical advance rates are higher than average - at 85-97% depending on industry and payment track record.

Personalized Solutions

We are not beholden to Wall Street investor money. We are a privately held company and don’t answer to investors or boards. We are like-minded entrepreneurs who understand what it takes to run a business. We take the time to hear your story, learn your struggles, and put together a solution for you rather than relying on an algorithm to determine your company’s value. Who do you want to rely on as a cash flow partner to fund your business?

Dedicated Account Administrators

Many factoring companies have either a lot of employee turnover, a complex voice mail system that you get lost in or operate call centers where you talk with a new representative every time you call in. We offer dedicated account administrators to be your point of contact – who knows your business intimately, and can help you in ways others just can’t.

Industry Veterans

We have been in business since 1979 and have staff who are dedicated to working in this industry as a career. We are veterans in this industry and can provide additional business guidance and resources as needed.

Our Business is Your Business

We establish a mutual risk tolerance to avoid putting you in the position to ever have to buy back an invoice. We also keep track of each invoice and follow them like your own credit and collections department would. Once they hit the payment date we place friendly reminder calls and/or emails on your behalf and keep notes as to when it is scheduled to be paid, and send copies if needed until payment is received.

Payment Trend Alerts

You will have access to online aging reports and your dedicated account administrator is kept in the loop and given advance notice of any collection issues so there are no surprises.

Up-to-Date Customer Credit History

You get direct online access to your customer’s business credit reports, or you can call and speak with your account administrator – your choice. Stay ahead of negative payment trends. This is critical to running your business and filling your next order.

Leading Edge Technology

We make strides to incorporate the latest technology to expedite the funding process, such as electronic submission of invoices, online reports, online credit checking and other emerging methods to streamline the process and reduce overhead, which means lower rates for you. Most other companies don’t even come close.

Financially Strong

We have been in business since 1979, are privately held, and have a proven track record of being financially strong. We have survived many economic downturns and in doing so, can help you through any difficult times you might encounter. We won’t go out of business when the times get tough, like some other factoring companies regretfully have in the past.

Part of a Vast Network

Every factoring company has a preference for size, industry, and risk. It’s impossible for you to know which company is the best fit for you. By contacting us, we can save you a tremendous amount of time by helping you find the best match for your business - whether it’s with us or another company.

We have a vast network of industry colleagues that we’ve built over 20+ years in the business. So, when you take the time to explain your needs to us, we can be the “one stop shop” to help you find exactly what you’re looking for.

No Minimum

Most factoring companies will allow you to pick & choose customers to factor, however they usually have a minimum amount before they’ll work with you. With us, you can pick & choose what to factor on an invoice by invoice basis with no minimum.

Our factoring agreement is like carrying a credit card in your pocket. You carry it to use when you need it but don’t sign an agreement which will force you into factoring when you don’t need it.

Transparent Fees

Most factoring companies are not upfront about their fees. We are different. We are totally transparent about our fees. When you apply, you are provided a transparent, no obligation rate proposal with the fee for your company.

Our typical contract term is 90 days and we offer price breaks for extended term contracts as well as volume discounts. Optional services include $7/ACH for next-day funds sent electronically to your bank account or $12/wire for same-day funds. Invoices can be scanned and electronically uploaded directly to our secure server for $9/batch. In instances when original invoices are required, we offer discounted rates with Federal Express to submit your invoices.

That’s it! See which other factoring company, if any, will be totally up front with their fees before they try and get your business.

Higher Advance Rates

An “advance” rate is the percent of the invoice face value that you’ll receive upfront. Industry average advance rates are 70-90% of the face value of the invoice. So, for example, if your customer owes you $1,000, you should expect to receive an advance payment of $700 to $900 to your account. Our typical advance rates are higher than average - at 85-97% depending on industry and payment track record.

Personalized Solutions

We are not beholden to Wall Street investor money. We are a privately held company and don’t answer to investors or boards. We are like-minded entrepreneurs who understand what it takes to run a business. We take the time to hear your story, learn your struggles, and put together a solution for you rather than relying on an algorithm to determine your company’s value. Who do you want to rely on as a cash flow partner to fund your business?

Dedicated Account Administrators

Many factoring companies have either a lot of employee turnover, a complex voice mail system that you get lost in or operate call centers where you talk with a new representative every time you call in. We offer dedicated account administrators to be your point of contact – who knows your business intimately, and can help you in ways others just can’t.

Industry Veterans

We have been in business since 1979 and have staff who are dedicated to working in this industry as a career. We are veterans in this industry and can provide additional business guidance and resources as needed.

Our Business is Your Business

We establish a mutual risk tolerance to avoid putting you in the position to ever have to buy back an invoice. We also keep track of each invoice and follow them like your own credit and collections department would. Once they hit the payment date we place friendly reminder calls and/or emails on your behalf and keep notes as to when it is scheduled to be paid, and send copies if needed until payment is received.

Payment Trend Alerts

You will have access to online aging reports and your dedicated account administrator is kept in the loop and given advance notice of any collection issues so there are no surprises.

Up-to-Date Customer Credit History

You get direct online access to your customer’s business credit reports, or you can call and speak with your account administrator – your choice. Stay ahead of negative payment trends. This is critical to running your business and filling your next order.

Leading Edge Technology

We make strides to incorporate the latest technology to expedite the funding process, such as electronic submission of invoices, online reports, online credit checking and other emerging methods to streamline the process and reduce overhead, which means lower rates for you. Most other companies don’t even come close.

As you can see, we simply have more to offer you.

Other factoring companies don’t even compare.

And Not All Factoring Companies Can Say This:

More than half of our new business comes through client referrals.

So, Can Your Niagara Falls Company Use Factoring?

Of Course! Companies of all sizes, from small privately-owned companies to large multi-national corporations, use factoring as a way to increase their cash flow. Factoring spans all industries, including trucking, transportation, manufacturing and distribution, textiles, oil and gas, staffing agencies and more.

Companies use the cash generated from factoring to pay for inventory, buy new equipment, add employees, expand operations—basically any expenses related to their business. Factoring allows a company to make quicker decisions and expand at a faster pace.

Unlike a bank loan, factoring has…

No principle or interest to pay over time

No debt to repay

Unlimited funding potential – no caps

Fast funding – no waiting months like at a bank

Approval is based on the strength of your clients, not your credit

Startups are welcome in using funding services

Some of the benefits you receive with factoring are:

Stop worrying about cash flow issues and start spending more time on your business.

No need to make monthly payments to repay a loan.

Receive money in as soon as two to four days – or sooner.

Reduce business costs associated with the collection process.

Win the battle against slow-paying clients.

Get instant credit evaluations for new customers.

Have complete control over your cash flow by deciding which invoices to sell and when.

Enjoy bulk-purchasing discounts or early payment discounts by having extra cash.

Improve your credit rating by having cash on hand to pay bills on time.

You get complete and detailed reports about your accounts receivable portfolio.

Provides cash for your expansion.

Provides cash for your marketing.

Improves your overall financial statement.

Stop worrying about cash flow issues and start spending more time on your business.

No need to make monthly payments to repay a loan.

Receive money in as soon as two to four days – or sooner.

Reduce business costs associated with the collection process.

Win the battle against slow-paying clients.

Get instant credit evaluations for new customers.

Have complete control over your cash flow by deciding which invoices to sell and when.

Enjoy bulk-purchasing discounts or early payment discounts by having extra cash.

Improve your credit rating by having cash on hand to pay bills on time.

You get complete and detailed reports about your accounts receivable portfolio.

Provides cash for your expansion.

Provides cash for your marketing.

Improves your overall financial statement.

See why factoring is the best thing since sliced bread?

You can get the cash you need for your business without going into debt... without owing any money! And We Will Fund You Fast! Don't wait any longer to get the funding you need. Give us a call today. We're waiting to give you money!

Call us today and let us help you get the cash you need to operate your Niagara Falls business effectively.

Niagara Falls is a city in Niagara County, New York, United States. As of the 2010 census, the city had a total population of 50,193, down from the 55,593 recorded in the 2000 census. It is across the Niagara River from the city of Niagara Falls, Ontario, with both cities named after the famed Niagara Falls which they share. It is part of the Buffalo Niagara Falls Metropolitan Statistical Area as well as the Western New York region.The economy for the city was originally based around the Falls itself, or at least the power generated by the massive waterfall. This cheap and abundant source of power was the driving force behind the rapid rise of area industry. Around the turn of the 20th century, thousands of immigrants from predominantly European nations such as Italy and Poland came to the area to work the chemical, steel, and manufacturing plants owned by present day companies such as Occidental.

Information for the state of New York

Schenectady, Albany, and New York City, once the major industrial cities of the lower Mohawk and the Hudson, continue their long-time manufacturing decline. Except in the mountain regions, the areas between cities are rich agriculturally. The Finger Lakes region has orchards producing apples, one of New York's leading crops; vineyards here and on Long Island make the state famous for its wines. The state produces other, diverse crops, especially grapes, strawberries, cherries, pears, onions, and potatoes (grown especially on E Long Island); maple syrup is extracted, and New York is the third leading U.S. producer of dairy goods.

New York's mineral resources include crushed stone, cement, salt, and zinc. In spite of significant decline, New York has retained some important manufacturing industries, and, by virtue of New York City, it has strengthened is position as a commercial and financial leader. Although the largest percentage of the state's jobs lie in the service sector, its manufactures are extremely diverse and include printed materials, apparel, food products, machinery, chemicals, paper, electrical equipment (notably at Schenectady), computer equipment (Poughkeepsie), optical instruments and cameras (Rochester), sporting goods, and transportation equipment. Printing and publishing, mass communications, advertising, and entertainment are among New York City's notable industries.

Long Island has aircraft plants (although these have declined sharply since the 1970s) and Brookhaven National Laboratory, a research center. Many corporate headquarters and research facilities have relocated in Westchester co., N of New York City. Some commercial fishing is pursued in Lakes Erie and Ontario and in the waters around Long Island. The state has c.18,775,000 acres (7,294,000 hectares) of forest, but forestry is no longer a major industry.

We will buy your invoices and give you the cash immediately.

Before making your final decision and entering into a factoring agreement, check out the fees applicable and the terms of the contract. Both of these can vary a lot, depending on the factoring company and the industry it is serving. -Niagara Falls Factoring Companies

THE FACTORING PROGRAM OF YOUR DREAMS

Niagara Falls Factoring Companies Articles

The Best Kept Secret in Financial Services: Freight Bill Factoring!

If you're an existing owner of a trucking business, or perhaps you're planning on starting a trucking business, then you may be interested in Freight Bill Factoring. Freight Bill Factoring helps trucking businesses, both large and small, achieve their overall business goals; but before making any final decision you must fully understand how Factoring works.

Freight Bill Factoring has become very popular with trucking businesses and is often referred to as the financial backbone of the trucking business. If you're not familiar with Freight Bill Factoring, you may not know that factoring is a financing alternative for business owners: it gives them immediate access to additional financing capital they may otherwise not have access to. The process of Freight Bill Factoring is actually quite easy: it involves a factoring company purchasing bill of ladings at a discounted rate. This process is a win-win situation for both the trucking company who receives immediate funds and for the broker who pays for the invoices.

Freight Bill Factoring Is Not New!

Freight bill factoring is not a new idea; in fact, it has a long, rich tradition. Most civilizations that have engaged in commerce have also engaged in factoring in one form or another. For example, business relationships during the colonial period in North America were required to make cash payments in advance against Accounts Receivable in order for the business to continue with its commercial operations, prior to their users being paid for their goods. So, they were engaged in factoring!

Factoring Specialists Have Many Services to Offer

Of course, factoring has become a lot more sophisticated over the years, and today it's focused on financial management, credit worthiness, and on collections. However, the basic concept of purchasing Accounts Receivable has stayed the same. In addition, the modern factoring company of today can do a lot more than just funding: a factoring specialist can assist clients by evaluating and setting credit limits, verifying customer's credit worthiness, and professionally managing Accounts Receivable collections. Right across North America we see factoring companies existing in all forms and serving business sectors and industries of all types; and today, many large financial institutions even have their own factoring divisions. Generally, though, factoring companies are smaller, independently owned enterprises.

Banks Step Out as Factoring Steps In

Factoring has become very popular with trucking businesses because, as most business owners can verify, commercial lenders have become increasingly inflexible, with stricter regulations and ever-changing lending criteria. This inflexibility has forced both small and medium sized businesses to search for alternative financing sources, and this is where factoring has stepped in. Factoring is a simple, workable, solution-based process, providing an alternative for trucking businesses when traditional means of financing are not available. Factoring is proving to be a great financial remedy, particularly as banks and other lenders are becoming less friendly to small business owners.

Factoring Companies Operate Worldwide

The volume of factoring around the world has today exceeded the trillion-dollar mark! Factoring companies operate on every continent and, in the last four years, worldwide factoring transactions have increased by 60%. And that's why we say that Freight Bill Factoring is the best kept secret in financial services!

We will buy your invoices and give you the cash immediately.

Niagara Falls Factoring Companies Articles

Bookkeeping for Freight Brokers and the Most Common Mistakes Businesses Make

A freight broker is either a company or an individual who effects the transportation of goods by pairing up shippers with transportation services. The freight broker is not only responsible for pairing reliable and authorized transportation carriers with shippers, but also organizing the shipping needs for various organizations. Besides matching shippers with carriers, a freight broker is also responsible for ensuring each and every piece of cargo reaches its destination - and in good condition.

In addition to these tasks, freight brokers are also responsible for maintaining accurate bookkeeping records, and those who fail to keep meticulous accounting records are likely to lose money in the long run. In this post we've detailed what we believe are the most common accounting mistakes freight brokers make, and ways in which they can be avoided.No. 1: Attempting to DIY Your Bookkeeping Can Result in Costly Errors

Whether you handle the books yourself or delegate this vitally important job to an unqualified employee or even a family member, DIY bookkeeping is seldom, if ever, a good idea. Yes, initially you'll undoubtedly save some money, but your inexperienced bookkeeper's errors can ultimately become very costly to your business and result in expensive financing terms, increased bond premiums, and other unnecessary costs.

We strongly suggest you employ the services of an experienced bookkeeper who's qualified to deliver accurate accounting records, which will ultimately result in fewer errors and the job being completed quickly and efficiently.

No. 2: Postponing Important Bookkeeping Tasks Due to Heavy Workloads

It's not easy running a business, and anyone who finds themselves in this situation understands only too well just how difficult it can be to find the time to complete day-to-day time-consuming tasks. It's imperative that things like reconciling credit card and bank statements be completed each month because it's only through these reconciliations that errors can be found; plus of course it's how you determine out how much credit or cash you actually have.

As tempting as it may be to postpone these tedious tasks, you must ensure that your credit card and bank statements are reconciled every month, ideally as soon as you receive each statement. Keeping on top of statements means you can quickly identify any lost checks, missing deposits, or fraudulent charges, and be able to handle any discrepancies in a timely manner.

No. 3: Failing to Track Receivables and Invoices

Your business depends on you getting paid, and you won't be paid if you're not regularly and properly accounting for receivables. The lifeblood of your business is cash, which means the success of your business is entirely dependent upon you accounting for receivables. To put it another way, if the period of time between paying your carriers and receiving payment from customers is unnecessarily delayed by poor accounting practices, your business cash flow is going to be very strained.

If you're time-poor and realize you simply don't have time to track and collect invoices, then invoice factoring is the perfect solution for you. For just a small fee your applicable invoices will be purchased by the invoice factoring company, but the best part about invoice factoring is that you receive immediate payment! No longer will you have the time-consuming responsibility of trying to collect payments, thus saving an enormous amount of office time: plus, it leaves you free to take care of your own job, which is handling the day-to-day running of your business.

No. 4: Overlooking Liabilities Can Have Disastrous Results

When a surety inspects your business records to underwrite a bond, one of their first and most important considerations is whether your assets are sufficient to cover your liabilities. It's difficult for inexperienced bookkeepers to understand the full implications of accurate record keeping and sometimes DIY accountants record a liability but once the payment is made they forget to reverse the liability. This is a serious error because it understates net income while overstating liabilities, which makes your business appear less financially stable than it actually is.

The only way to avoid these unnecessary accounting errors is to hire an experienced bookkeeper. It's always handy to have another set of eyes, whether it be a CPA or an owner, to regularly review the balance sheet and check for discrepancies in account balances.

No. 5: Miscategorizing or Creating Unnecessary Expense Categories

All too often we see inexperienced bookkeepers either creating unnecessary expense categories or wrongly categorizing expenditures, either of which can be a huge red flag. Generally, each industry uses a standard set of categories for expenses and failing to follow this set of rules can signal to a surety or loan underwriter that an inexperienced person is handling your books; meaning that they may not be well prepared.

It's really important that your business's accounting software is correctly set up, preferably with the help of an accountant or experienced bookkeeper. Additional expense categories should not be added unless absolutely necessary. If you have any queries about how to classify expenses, don't hesitate to ask for guidance from your qualified accountant or CPA.

No. 6: Submitting Invoices with Insufficient Details

Don't try to save time by skimping on invoice details. Your customers' invoices should have detailed information on each line item; for example, do you invoice per mile, by weight, or by piece? Is the charge a flat fee? If there are additional charges such as fees or reimbursements for fuel, these should be listed as separate line items. The only way to avoid any confusion is to ensure that charges are properly detailed on invoices.

The last thing you want is for your customers to complain about charges they don't recognize on their invoices; and missing information can cause much confusion, resulting in delays in payment. All of these problems can be prevented by ensuring that your invoices have complete, detailed, and accurate information. Don't create unnecessary problems by trying to skimp on invoice details.

No. 7: Not Learning or Understanding the Full Functionality of Your Accounting Software

Getting a business up and running can be very expensive and time-consuming, and many freight brokers simply don't have time to learn how to use their accounting software package to its full capacity. This is not a problem if all your accounting and bookkeeping tasks are being outsourced; however, if you're using the software in any way at all, perhaps even just for entering checks and running reports, we strongly recommend that you learn how to use all functions of your accounting software package.

You can save so much time and have easy access to real-time information on the financial status of your business if you have the right accounting software and you know how to use it correctly. Having this information at your fingertips can help you make the right decisions to grow your business.

Niagara Falls Factoring Companies Articles

Business Is Booming but Your Company's Cash Strapped!

A business needs good cash flow for many reasons, and many businesses have learned the hard way that business can be booming but they can still suffer from cash flow problems. There are many scenarios where a business might urgently require access to cash: it could be due to the sudden growth or expansion of a business, a major transaction may need to be expanded, perhaps there's a need to purchase equipment or even to employ more personnel.

Interestingly, research shows that many businesses (both small and medium-size) fail, not because business is bad, but because they experience difficulties when trying to meet short-term financial responsibilities. So how can a growing and profitable business get into serious financial trouble, or even go broke? It seems so contradictory, but on closer examination you'll see that it's not surprising at all.

Many Businesses Experience a Cash Flow Dilemma

It's so easy for a business to get into a situation where they have a cash flow problem: you only need one or two larger accounts to default on payment, or to take an additional 60 or 90 days to pay, and now you've got a cash flow problem!

Traditionally, business owners have depended on conventional lending sources for a business Line of Credit, and this often includes short-term Bridging Finance. But there are also many people in business who've used their personal credit cards for business-related expenses. Once business owners have exhausted traditional means of funding, the process of acquiring extended financing can become a time-consuming, trying, and often impossible task.

Factoring

Fortunately, today, we have a viable and effective alternative for business owners to get through cash strapped periods, particularly during periods of expansion and business growth. This innovative form of financing is known as Factoring; it's also sometimes referred to as Asset Based Lending or Accounts Receivable Financing.

Factoring has become a workable and realistic solution for many businesses, particularly when cash flow is uncertain and threatens the viability, or even survival, of the business.

How Does Factoring Work?

Basically, when a business has credit-worthy accounts receivables, the factoring process provides the business with an instant cash injection on those receivables. So, sometimes, when a lender says 'no' to a business, a factoring company may say 'yes', thus offering the much needed cash injection that so many businesses require to move forward.

Factoring companies understand the financial needs of their trucking clients and react very quickly to provide them with the professional, personalized, hands-on attention that they require. Freight Bill Factoring is actually a very simple process: it provides a business with instant cash flow in order to satisfy its cash needs, which in turn enables the business to grow and prosper.

It works like this! Your company has quality accounts receivables, and needs a cash boost. A factoring company may purchase just one, or a group of your receivables, and in return will immediately give you up to 100% (less fees applicable) of the face value of these accounts. Once the customer invoice has been paid in full the balance is forwarded on. Yes, factoring costs more than other means of lending, but factoring clients believe the benefits far outweigh the costs.

The Benefits of Factoring

Possibly the greatest benefit of factoring is the short turnaround time, because factoring companies don't have a lengthy loan approval process, unlike banks and other lenders. This means that, with factoring, trucking business owners can have money in-hand by the end of the same working day!

In order to receive approval as a factoring customer, a trucking business must first-of-all be a reputable trucking business, and secondly, it must have credit-worthy customers. Once a business has been approved for factoring, funding will be provided on the same day. It's important to note, also, that ongoing financing is only limited by the amount of receivables available for purchase.

In the last decade we've seen factoring grow very quickly, and today it's become a financially feasible alternative for many trucking companies. Many trucking companies have stated that Freight Bill Factoring has made it possible for them to process orders and undertake loads from brokers that would otherwise have been impossible because of a lack of financing. Freight Bill Factoring is here to stay, and it clearly has a place in today's business environment. Because of factoring, a trucking company can expand its customer base, increase loads, and even survive a seasonal slump. Thanks to Freight Bill Factoring, many businesses have been able to expand and grow, and easily survive in what has become a very competitive industry.

Niagara Falls Factoring Companies Articles

Factoring: An Overview

What Is Factoring?

'Factoring' is when a third party commercial finance company purchases the Invoices or Accounts Receivable from a business. The finance company concerned is called a 'Factor' and the transaction is known as 'Factoring'. Factoring is also known as 'Accounts Receivable Financing' because factoring occurs when a business needs to access cash quickly, quicker than if it had to wait the 30 to 60 days (or longer) to receive payment from a customer.

The majority of factoring companies purchase invoices and advance cash within 24 hours, although the terms and nature of factoring can differ between industries and different financial service providers. Depending on the industry, the customers' credit histories, and various other criteria, the advance rate can range from between 80% and 95%. The business also receives back office support from the factor. Once the factor has collected from the business's customers, the business will be paid the reserve balance of the invoices, less a nominated fee for assuming the collection risk.

The main benefit of factoring is that a business is not required to wait one or two months (sometimes more) for payment by a customer - the business will receive cash in hand to operate and grow their business. It's important to note that factoring is not a loan: there's no debt with factoring. Funding is unrestricted, which means that a business has more flexibility than borrowing from a bank.

The Five Simple Steps of Factoring

1. As a business, you provide a service to your customer;2. The invoice for this service is sent to a factoring company;3. On this invoice, you'll receive a cash advance from the factoring company;4. It's now up to the factoring company to collect full payment from your customer;5. Once payment has been received, you'll receive the balance of your invoice account from the factoring company - minus their fee.The Advantages of Factoring

There are many reasons why factoring has become a popular and valuable financial tool for businesses today. The key benefit of factoring is that a business receives a quick boost to its cash flow: in fact, many factoring companies offer cash on their Accounts Receivable within 24 hours! The factoring company takes responsibility for collecting customer payments, and may also evaluate the payment and credit histories of a business's customers.

Other Benefits Include:

' When a business needs access to cash, factoring can be customized and managed in order to provide the necessary capital;' The business balance sheet will not show this financing as a debt;' Factoring is not based on the company's credit or business history: it's based on the quality of its customers' credit;' Factoring is not determined by the company's net worth: it provides a Line of Credit based on sales;' There's no limit to the amount of financing through factoring, unlike a conventional loan;' Factoring is an ideal solution for start up businesses that often require immediate cash flow.

Is the Concept of Factoring New?

No, it's not! In fact, the origin of factoring comes from overseas trade among nations and dates back several centuries to the 1400s when it became part of doing business in England. In the year 1620 it arrived in America with the Pilgrims. Like other financial tools, factoring has improved and evolved over the years. It became an effective way of creating cash flow in the United States at a timewhen companies faced strict limitations when trying to secure loans in the country's damaged banking system.

Who Uses Factoring?

Factoring is available for companies of all sizes, ranging from a one person business to Fortune 500 companies. Every business can use factoring as an effective way of increasing their cash flow. In addition, factoring spans all types of industries, from transportation, trucking, textiles, manufacturing and distribution, staffing agencies, and oil and gas.

The cash generated from factoring is used by companies to purchase new equipment, pay for inventory, expand operations, add employees, and basically cover any expenses related to the running of their business. The beauty of factoring is that it allows companies to make quick decisions and to expand at a faster pace.

How Does Factoring Work?

For the purpose of this post, we'll describe a fictional example as a way of illustrating a common factoring situation.

XYZ Transport is a trucking company: their intention is to double their fleet size over the next two years in order to service more clients in the West. The company has just successfully won a new customer on the West Coast who requires freight to be shipped from Oklahoma to Los Angeles. This new customer is more than happy to pay for the service within 30 days; however, that won't cover all the immediate costs involved, like payroll, fuel, and maintenance costs of running the route.

This is a familiar situation for the owners of XYZ Transport: the lack of available cash flow in the past has prevented the company from accepting new business. So now XYZ Transport has turned to a factoring company: they have agreed to sell the West Coast customer's invoice to the factoring company in exchange for a 90% advance on the total amount - within 24 hours! This much needed influx of cash will replenish the trucking company's reserves and allow it to continue running the Oklahoma - Los Angeles route. In addition, XYZ Transport now has the added flexibility of taking on new customers.

How Much Do Companies Factor?

Each company has its own unique business needs, so somecompanies only factor invoices for customers that are slow in paying, whilst other companies factor all of their invoices. Companies can factor receivables ranging from a few thousand dollars right through to millions of dollars each month.

What's the Difference between Factoring and a Traditional Bank Loan?

Factoring, also known as Accounts Receivable Financing, is a quick, flexible and effective way for businesses to create a steady cash flow stream. See below for how factoring is different to a Line of Credit at a bank or a traditional business loan

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Important Points to Remember When Choosing Your Factoring Company

Now that you've decided that factoring would be a solid business decision for your company, the next step is to find the perfect factoring company for you. Once you start looking you'll discover that there are many factoring companies (or 'factors') in the marketplace, and this is the perfect situation for you as a potential factoring client.

But it can also be confusing, because now you have to find the right factoring company to suit your business's needs. To assist you in making the right decision we've listed below the main issues that should be considered when choosing a factoring company.

Factoring Fees and Terms

Before making your final decision and entering into a factoring agreement, check out the fees applicable and the terms of the contract. Both of these can vary a lot, depending on the factoring company and the industry it's serving. When you start your research you'll discover that some factoring companies charge a flat fee: this fee is, in effect, a certain percentage of the total value of the customer invoices you sell to them; whilst others have additional charges to cover the general costs of doing business - such as, money transfers, shipping, collateral, and so on.

Ensure that the factoring company you're considering working with is transparent and upfront with you about its fee structure. In addition, you may want to consider a long term contract with your factoring company if it includes flexible rates or a price break. If you're receiving competitive offers from other factoring companies or you have increased factoring volume, you'll discover that many factoring companies will be prepared to adjust their rates. A one year contract is the industry standard for most factoring agreements. Generally, unless you give your factor a 60 or 90 day notice, your factoring contract will automatically renew.

What's the Difference between Recourse and Non Recourse Factoring?

It's important that you understand the difference between recourse and non recourse factoring prior to choosing your factoring company, because you need to know what the best fit would be for your company and your customers. So, with non recourse factoring, all of the credit risks for the collection of the invoice belong to the factoring company; while recourse factoring means that, with you being the client, you'll ultimately be responsible if the factoring company is unable to collect payment on your customers' invoices.

There are benefits to recourse factoring, and perhaps the main benefit is that it's less expensive than non recourse factoring. If you have a recourse agreement and the customer defaults on payment, it doesn't automatically mean that you'll be asked to settle the debt out of pocket. Generally, what happens is that the factor will hold back a portion of either future cash advances or payments being held in reserve, with the money being placed in an escrow account awaiting settlement of the debt.

Our suggestion is that you find a factoring company that offers both recourse and non recourse factoring, because not all of your customers will be good candidates for recourse factoring. An experienced factoring company working with a strong credit team can also behelpful in ensuring you're working with good customers: this will relieve some of the pressure of being stuck with bad debt.

Experience and Capital: The Two PreRequisites

Your company should be looking for a factoring company with experience in your industry, including the capital structure to fund your business as it continues to grow. Once you start researching factoring companies you'll discover that there are a lot to choose from; however, many of these are recent start ups with limited experience. Prior to signing any factoring agreement, do your research and look into the history and background of the factoring company concerned, especially its ability to provide financial services in your area of expertise.

The idea with factoring is that, as your company grows, the funding of your customer invoices will grow with you.Research the factoring company's client base and their capital structure. What's a typical account size? What's the factoring volume of their largest client? Is the factoring company limited to how many debtors it can handle? In general, factoring companies that have been serving your industry for many years will usually be able to offer your business the best deal.

Additional Factoring Services

There are many more benefits to factoring than simply increasing your company's cash flow. Because the factoring company will be handling the collection of your customer's invoices, your company will be saving time and resources. A good factoring company will also be able to evaluate companies in your industry and provide credit information. In short, your factor will ensure that you experience excellent customer service. You'll be matched with your own representative who'll be able to address any questions or concerns you may have about your factoring account.

So, when researching factoring companies, look for a factor who not only offers additional products but provides a high level of customer service that will help your business grow by assisting you in making smart business decisions.

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The benefits of using a Factoring company versus a bank loan

If you are looking for a convenient way to obtain business capital, factoring is one of the best options available out there. From a recent study, it has been identified that many people go for bank financing in such instances, considering that it is the least expensive method of investing. However, factoring is associated with many other advantages and we will let you know about them through this article.

A proper cash flow is something that every business in the present world should have. In addition, they need to speed up their cash flows along with time. Otherwise, it will not be possible for them to get banks for financing. Unfortunately, banks are not in a position to accommodate all the financial requirements of a company, due to tough credit standards. That is where factoring comes into play. It happens when a company sells its accounts receivable to a bank or a factoring company. The amount that can be taken depends on value of the invoice.

Key benefits associated with factoring

' A company can get large amounts of capital through factoring. It is because this method is entirely based upon accounts receivable. It has impressed many small scale businesses out there since they can obtain a bigger line from their accounts receivable for services or goods. They will not be able to get such a big amount of capital from any conventional bank lender out there. Factoring is something that is based on the credit strength of your potential customers. If your company has more potential customers with healthy credit strengths, you can easily enjoy the benefits of factoring.

' Factoring is quicker than traditional bank loans. Since most of the accounts receivable factoring lines are in a position to be set up, approved and actively funded within a matter of few weeks, you can go through a hassle free process. However, banks will take more time to engage with their credit reviewing activities about your company. They might even wait for audit results or fiscal period closes. Therefore, if you are in need of quick business capital, factoring is the number one option available out there to consider.

' Factoring is something that expands quickly along with the growth of your company. Almost all the factoring companies out there support it. Your company doesn't need to have an excellent track recording of business. You just need to select a factoring company that is big enough to accommodate all your business development ambitions.

' A factoring company does not offer loans to their clients. Therefore, you cannot find many similarities between a loan and factoring. A factoring company will purchase your accounts receivables along with cash. Therefore, it can be considered as a similar process to increasing the working capital, while showing it as a liability in the account balance sheets. This will even reduce debt in the balance sheet, when compared to borrowing. At the end of the day, your company will get the opportunity to enjoy a lower debt to equity ratio.

' Factoring is less expensive than equity. Most of the businesses approach equity investors to cater their financing requirements. However, there isn't any substitute for equity capital in some expansion purposes and business investments. Almost all the equity investors expect a higher return from the accounts receivable than the cost. When it comes to factoring arrangements, you won't be able to find any dilutive effect on shareholders. This will assist you a lot to stay away from hassle.

' Factoring is also recognized as one of the best options available to improve your turn. In the present world, many factoring companies will verify invoices with your customers and check whether they are being paid on time. This will motivate your customers to pay the invoices on time through a gentle reminder. This will result in a better service delivery from your end as well.

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About Invoice Factoring

Perhaps you've heard about Invoice Factoring but you're not sure how it works or how it might help your business. The purpose of this post is to provide a clear explanation of what Invoice Factoring is and how it works.Basically, Invoice Factoring is a viable alternative to traditional financing methods, providing your company with fast access to working capital. There's no large debt to repay and there are no strings attached. It probably sounds too good to be true, but we can assure you it's not! Invoice Factoring has become a lifesaver to many businesses, so let's go into this a little further to see how Invoice Factoring might help your business go from just so-so to really great!

How Invoice Factoring Works

A very brief definition of invoice factoring is that it converts your open invoices into immediate cash, which of course sounds perfect if you're experiencing a cash flow problem. Factoring saves you from having to wait the 60 or 90 days (sometimes even more) for payment by your customers. With invoice factoring you have the flexibility to factor whichever invoices you want and however many invoices you need, to ensure you have enough cash on hand to grow your business.

The following is a short description of how the process works -

Once you and your chosen factoring company have reached an agreement and set up your account, you're now free to begin submitting copies of your unpaid invoices to the factoring company. These invoices must be for products that have been delivered or for work that's been completed. With invoice factoring you simply continue invoicing your customers as usual, then fax or email a copy of the invoice directly to your factoring company.

Now here's the good part! You'll receive a cash advance within 24 hours! Once the factor has verified your invoices, a deposit of as much as 95% of the value of the invoices will be deposited directly into your bank account.

You continue working as per usual, and the factoring company works to collect on your accounts. It's now your factor's responsibility to engage in the active collection of these accounts, thus allowing you more time to focus on the big stuff, like providing your customers with excellent service and continuing to grow your business.

As a customer of the factoring company you can repeat this process with as many different clients as you want and as many times as you want. You may choose to factor all of your clients, or just the clients that are known for being slow-paying clients. The choice is yours!

The Benefits of Invoice Factoring

Once you're working with an invoice factoring company you'll have control over your cash flow, and more importantly, you'll have a working relationship with your factor that will help your business grow in lots more ways. Let's take a closer look at some of the ways a factoring company can help you grow your business -Credit Checks and Background Verification

It's important to all businesses that they work with honest, reliable customers; customers who have a solid payment history. Sales must be turned into revenue as quickly as possible. However, we know that credit checks and background verifications can be very expensive and these costs very quickly eat away at your working capital. Now, it will be your invoice factoring company who provides these checks for you, at no additional charge. This means that any issues will be addressed before they affect your business, thus ensuring that you're working with top-quality customers.

Credit Repair and Credit Building

Even if your business credit is less than perfect, you can still apply for a competitive invoice factoring program. The benefit of this to the business owner is that, not only will factoring your open invoices cover your daily operating costs, it will also help pay down any current debt in order to rebuild your credit rating. The good news is that start-ups also qualify for invoice factoring so, if you're just getting your business off the ground, factoring is the ideal financing alternative to help you hit the ground running.

Other Money Saving Opportunities

Invoice factoring can certainly save your company money, and it's not only with competitive rates. By negotiating with your suppliers for early-pay discounts or other payment incentives, you'll soon discover new ways of putting your rejuvenated cash flow to good use. And don't forget that, depending on how much you factor, you could well qualify for a volume discount, and this will further reduce your rates.

Steady and Consistent Cash Flow

When you begin factoring your invoices you'll be able to regain complete control of your working capital. Whether you're simply tired of waiting up to 90 days for money that's owed to you, or perhaps your business is subject to seasonal fluctuations, either way, invoice factoring is the ideal method for regulating your cash flow.

Now You Can Start Dreaming Big!

You may have become used to business being steady, but with invoice factoring you'll have the opportunity for business growth in many new ways .

o You'll be able to attract larger clients, with better contracts;o Increased business marketing efforts; o New technology investments, or upgrades; o The ability to employ more staff; o Training and further education programs for existing staff; o Relocation of your business, or site expansion.

Finally, No More Debt!

One of the most attractive things about invoice factoring is that it's not like a traditional loan: it won't add additional debt to your balance sheet. In fact, it's actually the opposite; because Invoice Factoring provides you with the extra cash you need to be able to settle old debts. With factoring, it's already your money so there's no money to pay back and no interest to pay. All factoring does is help you get your money into your bank account - quicker!

Why Haven't I Heard of Invoice Factoring Before?

This is a question a lot of business owners ask. Invoice factoring certainly isn't new, but maybe it's just been overshadowed in the past by bank loans and other types of business investments. The fact is that factoring goes right back to the days of the Roman Empire, where factors assisted businessmen (usually farmers) in growing their business. Then, later, it was used in the textile and clothing industry to help pay for raw materials, to finance transactions, and accept larger purchase orders. Today, invoice factoring is used by many different types of industries, such as:

Don't be discouraged because you don't understand factoring terminology. See below for an explanation of general factoring terms :

' Account Debtor: An account debt or is your customer.

' Accounts Receivable Ageing Report: This is the name given to a report which shows the financial figure of unpaid receivables, in addition to how long they've remained unpaid.

' Accounts Receivable Factoring; also known as Invoice Factoring: These two terms can be used interchangeably because they mean exactly the same thing.

' Discount Rate: This refers to the percentage of the invoice charged by the factor as a fee for advancing funds.

' Due Diligence: This refers to the background research carried out by the factor to determine potential customers.

' Factoring Advance Rate: This rate is a percentage of the invoice that's advanced within 24 hours to the client - this figure is generally between 80 and 95% of the total amount of the invoice.

' Factoring Broker: A factoring broker is a third party whose position is to connect business owners with appropriate factoring companies in order to meet the business's goals and needs.

' Lien: The right to retain possession of property until a debt has been discharged.

' Non-Recourse Funding: Most businesses have experienced customers who fail to pay their invoices within the agreed payment terms, or worse, the invoice is never paid at all! Non-Recourse Funding is when the factor assumes all responsibility for unpaid invoices. Because the factoring company is accepting the risk, Non-Recourse Funding is more expensive than Recourse Funding.

' Recourse Funding: With Recourse Funding, your company must buy back the receivables if your client fails to pay within the agreed payment terms.

' Reserve: This is the amount of the Accounts Receivable retained by the factor until such time as full payment has been made by the customer.

' Spot Factoring: This refers to a one-off agreement that offers staffing companies the ability to factor just one single invoice.

Your Customers, and Factoring

It's important that we point out here that factoring is not a negative thing, and your factoring company is definitely not a collections agency. In fact, it's important to your factoring company that they maintain good relationships with both you and your customers, and it's their aim to provide the best customer service possible. It's in your factoring company's best interests that the factoring process works as smoothly as possible.

The following will give you a general idea of how factoring works :

' Once you've made the decision to start invoice factoring, your dedicated account manager will start by verifying that your debtors are indeed customers, in addition to advising them of your new remittance address. It's important to remember that it makes no difference to your clients where they send their payment: they know their invoice must be paid, so this is simply a change of address for payments.

' Your factoring account manager will be very experienced and will assure your clients that they'll be well taken care of, and that the factoring company will be managing your invoices in future by taking over your accounts receivable. And that's all there is to it! Nothing will change between your company and your customers: you'll still invoice them as usual, and they'll simply forward their payment to a new Post Office box. Your account manager will be available to help if any problems should arise.

What You Should Look For in a Factoring Company

Once you start doing your own research you'll discover that there are many factoring companies out there, but they're definitely not all equal. The following are points to consider when comparing factoring companies:

' Fees As we've explained, factoring is a little more expensive than a traditional bank loan, but some small businesses don't qualify for a bank loan, so being able to achieve some working capital is better than none at all. Do your research, and make sure you understand the overall cost of factoring, in addition to the extra smaller fees that may be charged by your factor. These extra fees may include account set-up fees, application fees, credit reports, costs to research any liens, charges for last-minute funding, or for money transfers. Not all factors charge these extra fees, and not all factors have hidden fees, which means that it's very important that you choose a factor you're comfortable with and one that you can trust.

' Flexibility This is a very important aspect of factoring, and one we can't stress enough. Make sure you very carefully read the fine print of your factoring contract! If you start working with a factoring company and then realize that you're locked into terms that don't suit your own particular circumstances, you're going to be extremely unhappy. These unsatisfactory terms might include how much you're able to factor each month, or being tied to a specific factoring company for the life of your business. If you sign up for a long-term contract, then change your mind, it's going to be a very expensive exercise trying to get out of the contract. Don't let this happen to you! Be very clear on how much you can factor each month, which clients are eligible for factoring, and how long you're signing up for.

' Communication At one point or another we've all had to deal with a business with poor communication skills, and we probably all agree that it's extremely frustrating. So, imagine a business with poor communication skills that's also handling your money! Naturally, when it comes to your business and your money, you need someone that's going to immediately respond to your inquiries. All factoring companies are going to say their customer service is second-to-none, but be very cautious here. Pay close attention to when and how your potential factoring company responds to your calls and emails, because this is how they'll be responding to your customers. If you're not 100% happy then move on to another factoring company, because there are certainly plenty to choose from!

' Industry Expertise Remember that there are many factoring companies out there servicing many industries, so you should be looking for one that services your own industry. Ideally, you'll choose a factoring company that specializes in your niche, which means that they'll already understand a lot about your business. The bonus of using a factoring company with industry expertise is that they may also offer programs specific to your industry, such as fuel cards and back-office support. It's these extras that may prove very beneficial when making your final decision on a factoring company.

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Medical and Healthcare Factoring

Receive Payment Today! No Waiting Weeks for Reimbursement!

It's certainly no secret that Medicaid, Medicare, HMOs, Workers' Compensation, and other private insurers can take a LONG time to pay your invoices! But now there's good news for healthcare professionals! Now you don't have to wait weeks, sometimes months, to collect on your medical receivables. If you're a healthcare professional and you provide medical or healthcare-related services of any type, we're here to help you!

The Difference between Healthcare Factoring and Medical Factoring

Healthcare factoring and medical factoring are phrases that are often used interchangeably, probably understandably, but there is a difference between these two. The difference is that healthcare factoring applies when there's no third party payer involved, while a medical factoring company is used when there is a third-party payer involved.

Healthcare Factoring and Medical Receivables Factoring are available for the following healthcare providers -

Generally, healthcare receivables are associated with customers who are not third-party payers. Some common healthcare sectors include medical staffing companies, medical transcription services, medical billing and coding services, and medical supply companies. When these vendors utilize healthcare factoring they're free to enjoy the benefits of an almost unlimited line of credit - all based on the services they've provided. A simple explanation of factoring healthcare receivables is as follows-

- When work has been completed, the healthcare vendor will invoice their customer. - These customers may include nursing homes, hospitals, medical offices, and so on. - Next, the vendor will forward a copy of the billing documentation to the healthcare factoring company. - Within 24 hours, sometimes even less, the factoring company will deposit money into the vendors bank account. The amount deposited will generally be around 85% of the gross value of the invoice. - The factoring company handles collections on behalf of the vendor, and will retain 15% while awaiting payment. - Once the invoice has been paid in full, the factor will release the 15% - less their factoring fee - back to the vendor.

Medical Receivables Factoring

- Regardless of whether you're billing Medicaid, Medicare, HMOs, Blue Cross/Blue Shield, or third-party insurance companies, we have the perfect factoring solution for you. When you start factoring your medical claims you'll achieve instant benefits by receiving upfront capital; while the factor may have to wait months for your customers to settle their accounts. A simple explanation of factoring medical claims is as follows-

- The healthcare provider submits claims to the third-party payer, as usual. - A copy of completed paperwork is then submitted to the factoring company. - Within 24 hours, sometimes even less, the factoring company will deposit money directly into the medical provider's bank account: the amount deposited will typically be around 85% of the net collectable value. - Once the claim has been paid in full by the third-party payer, the factoring company will release the remaining 15% - less their factoring fee.

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Bookkeeping Mistakes Commonly Made by Freight Brokers

It's true that freight brokers shoulder a lot of responsibility; from matching shippers and carriers, to ensuring that each and every piece of cargo arrives at its proper destination. Freight brokers also have the added responsibility of accurate bookkeeping, because failure to prioritize bookkeeping can result in the loss of money.

Below we've listed some common bookkeeping mistakes made by freight brokers, and how to avoid them-

Handling the Accounting In-House

Many business owners try to save money by handling the books themselves, or perhaps delegating this very important task to a family member or an inexperienced employee. Sure, you may save time and money initially, but errors can be costly: when you attempt DIY accounting you could well end up with more expensive financing terms, higher bond premiums, or a number of other unforeseen expenses. It's very important that you hire a competent bookkeeper because, not only will you save money, but you'll know that the job will be done accurately, quicker, and more efficiently.

We understand only too well that running any business is time-consuming and hard work, and many freight brokers are simply too busy doing their day-to-day tasks to focus on bookkeeping tasks, such as the monthly reconciliation of credit card accounts and bank accounts. It's through reconciling statements that you get a clear idea of how much credit or cash you actually have, and you can also pick up on any errors that may have occurred.

It can be so tempting to postpone this rather tedious task, but the truth is that your credit card statements and bank statements must be reconciled every month, preferably the moment each statement becomes available. In this way you'll be able to identify any potential problems in a timely manner; problems such as lost checks, missing deposits, fraudulent charges, and so on.

Failing to Track Invoices and Receivables

You're not going to get paid if you're using poor accounting practices with your accounts receivable. Let's face it, getting paid equals cash, and cash is the lifeblood of every business. An experienced freight broker understands that your cash flow can be strained by the delay between when you pay your carriers and when you receive payment from your customers. If you're finding that tracking and collecting invoices is taking too long, why not consider invoice factoring? An invoice factoring company will purchase your invoices for a small fee, with the bonus being that you get paid immediately, plus you're spared the time and expense of having to deal with collections.

Don't Forget Liabilities

One of the major considerations a surety has when looking at your business financials in order to underwrite a bond is whether you have sufficient assets to cover your liabilities. Many times we see an inexperienced bookkeeper recording a liability, but when the payment is made they forget to reverse the liability. This is a serious error because it results in liabilities being overstated and net income being understated, which makes your business appear to be less financially secure than it really is. These serious errors can be avoided by employing the services of an experienced bookkeeper. We also recommend that you have another set of eyes (which may be an owner or a CPA) regularly review the balance sheet to check for unusual account balances

Too Many Expense Categories

Another common error we often see with inexperienced bookkeepers is creating too many expense categories, or miscategorizing expenses. Generally, most industries and businesses have a standard set of expense categories, and when a loan underwriter or surety sees too many categories, or the miscategorizing of expenses, it stands out like a big red flag. It tells them that your books are not well prepared. Use an accountant or experienced bookkeeper to correctly set up your accounting software right from the beginning, and don't automatically add new expense categories unless careful consideration has been made. Remember to ask your accountant or CPA for advice, because they'll be able to guide you on how to classify expenses.

Incomplete Information on Invoices

It's very important that, when you invoice your customers, you provide sufficient detail on each line item. Do you invoice by weight, per piece, or per mile? Or is the charge a flat fee? If there are additional charges to invoice, such as reimbursements for fuel or fees, these should be listed as separate line items. In addition, these charges must be clearly and accurately detailed in order to avoid any confusion. When you send invoices to your customers that include clear and concise details, it prevents pushback from your clients. If there's missing information on your invoices and your customers are confused by unrecognizable charges, it could well cause a delay in payment, which is the very last thing business owners need.

Not Understanding the Functionality of Accounting Software

Many freight brokers purchase an accounting software package because they're anxious to get their business up and running, but they fail to learn how to use it correctly. This is probably not an issue if you're already outsourcing your accounting and bookkeeping tasks; but if you're using this software in any way at all, perhaps to enter checks and run reports, it's important that you spend some time learning how to use all the available functions. When used correctly, the right accounting software can save you a lot of time, in addition to providing real-time information on the state of your business. It's this information that helps you make important business decisions!

Niagara Falls Factoring Companies Articles

Oil Well Cleaning Owner Interview

The oilfield services industry is certainly a booming one these days thanks to a renewed emphasis on searching and drilling for oil on private and state properties. One of the more profitable ventures in this field is not the drilling for oil, but the cleaning of oil and gas wells to keep them operating at full efficiency. Oil and gas drilling is a dirty business and wells will quickly become clogged even with regular maintenance.

Jeffrey Fielding is the owner of an oil well cleaning company who works with several drilling companies in providing cleaning and maintenance of oil wells. Over the past couple of years, Jeffrey has managed to grow his business considerably thanks in large part to his perseverance and determination. However, things were really tight when Jeffrey first started up his company and at one point he was faced with a dilemma that he didn't know how to overcome.

The following interview with Jeffrey tells how he managed to expand his company at a crucial time thanks to oilfield services factoring. If it wasn't for the presence of factoring companies that worked in his field, Jeffrey might be in a completely different business today.

"Hello, Jeffrey. It's good to talk with you and I'm glad you were able to spare the time to share your story with us."

Jeffrey Fielding: "Thanks, I'm glad to be here."

"Jeffrey, tell us a little about how you got into the oil well cleaning business first as it's something our listeners may not be fully aware of."

JF: "No problem, I'll start at the beginning. About ten years ago I joined an oil well crew as a roughneck, working my way up through the business. It was hard work and our crew was usually out in the middle of nowhere, but the money was good and the opportunities kept building for me. I quickly learned the job and was hired by a number of drillers to work their rigs over the next few years during the boom in the oil industry."

"Right from the beginning, I took notice the oil well cleaning crews that would work each rig and started talking to the guys who were a part of that business. After a few years it became clear to me that oil well cleaning was really where it was at 'cause the work was really steady and the money was just as good, if not better than what I was making. So, with the money I had saved up along with a couple of partners I opened up an oil well cleaning company of my own."

"It certainly sounds like you struck gold so to speak. So tell us how your business started."

JF: "It was pretty easy as we got our business loan, purchased the equipment and hired a couple of experienced people to help us clean oil wells. We had some pretty good connections and the orders started to pile in, but then we ran into a problem that none of us could even dream of happening. We became victims of our own success."

"I don't think I quite understand, could you explain just how that happened?"

JF: "Sure, about six months in we suddenly got new drillers who wanted to use our services, but we didn't have the money to expand. We get paid by invoice which can take up to 60 days to see the cash which meant that we trying to pay down our loan, the payroll and the equipment, fuel and other costs and didn't have enough cash on hand to expand. We knew that if we didn't hire new people and buy new equipment that we would miss out on a golden opportunity. However, one of my friends told me about oilfield services factoring companies that could help us out."

"What are factoring companies?"

JF: "Basically, a factoring company will buy the invoice and get us the cash immediately. We had good credit and our invoices were certainly good as well. By using their services, we were able to get the cash in our hands quickly and pay for new equipment to then expand our business efforts."

"It certainly sounds like the factoring companies saved the day for you, but just how do they work?"

JF: "Well, it was a pretty simple process. We just filled out a few forms with the information that they requested and then we sold the invoices we had already collected, but had not collected to the factoring company. We got the cash we needed immediately and they collected the invoice."

"It certainly sounds pretty easy, but why didn't you just get another loan?"

JF: "My partners and I went over that and another loan would just be too big a burden. We were already paying off our old loan which was considerable and didn't want to have more debt hanging over our company. By going with the oilfield factoring companies, we didn't owe anyone, anything. We just collected the money that we were owed a lot more quickly."

"So, how is business now?"

JF: "It's better than ever. By using a factoring company I was able to buy new tubing, cleaning fluids, a new vehicle and other equipment that let us take on the new orders. We were able to expand the business quite a bit and our reputation is such that we work with several drilling companies."

"It sounds like a dream come true."

JF: "It really does, but I don't know what we would have done if factoring companies didn't exist. We still use them when we need cash for new equipment or products to do our job. It's quick, safe and brings us the money we need to continue our business."Jeffrey's company really benefitted from using oilfield factoring companies that served his industry. There are factoring companies for other types of businesses as well that can take invoices and turn them into quick cash for businesses that need to expand. For Jeffrey and many other small business owners, factoring companies can make the difference in the success of your efforts.

Niagara Falls Factoring Companies Articles

Oilfield Services Factoring Services

Running a company in the oilfield services industry is no easy business, especially with payrolls to meet, equipment to purchase and deadlines that must be met. The sheer complexity of combining the geological research and modeling, imaging and exploration and finally the drilling to see whether oil is really present can take a lot of investment before any payoff can be seen.

For those who own a Frac Sand Hauler for example, the efforts that must be put in to start such as business can be considerable. But arguably the biggest challenge is paying the expenses as the invoices come in. A Frac Sand Hauler often has expenses that must be met immediately, but their invoices can take up to 60 days before they see the money.

What follows is an interview with Ray McClerand, a man who owns a Frac Sand Hauler business and ran into the same difficulties that many new companies of his type face. How Ray overcome some of the challenges in paying his bills through oil service factoring are explained in the interview.

"Welcome Ray, I'd like to know first why you decided to start up a Frac Sand Hauler company and how you prepared for the challenges it created."

Ray McClerand (RM): "I've been in the oil business for the past 15 years or so working on different jobs from roughneck to foreman to deskwork for different companies. A few years ago I saw the potential of having a Frac Sand Hauler business in this area and got together with a couple of partners to create a company. We sat down, went over the details and decided that this would be a real good time to build a business that was serving a particular need in this industry."

"So, I take it you created a business plan and took out the appropriate loans in order to purchase the equipment and hire the personnel necessary to get your company started?"

RM: "Exactly. Because I had been around this business for a while, I understood what was needed in terms of personnel and equipment. Plus, I had some contacts with others in the business that needed the type of services that a Frac Sand Hauler provides, so I felt that there was some real potential to make a profitable business work."

"How did it go over the first six months or so?"

RM: "At first, we were really thriving as my contacts had lined up some business my way. Our loans covered the first six months or so of operations and we were doing quite well with the business we had. My partners and I were certainly happy and everything was going good when something really strange happened."

"Could you elaborate on what you mean by "strange"?

RM: "Yes, after the first five months or so I started getting requests to have our company work with several other businesses in the area. This would mean having to expand our company through buying new equipment and hiring more people. But we did not have the cash on hand to make such a move. We were getting invoices from the businesses that we worked with, but it was taking up to 2 full months before we actually got the cash."

"So, you were making enough money to expand, but you didn't have it on hand because of the invoice system?"

RM: "You got it. Add to that our initial money from the loan was running out and we needed to start paying it back as well. I knew that if we didn't expand and accept the new business that others would step in and we would lose that money. So, we were in a real pickle until I heard about oil service factoring companies."

"Tell us a bit about oil service factoring and how it helped you out?"

RM: "Well, one of my partners had heard about factoring companies, so we checked it out and decided to go with one that was best suited for our needs. A factoring company buys our invoices with cash so we have money on hand to pay our bills and do what we need accomplished immediately. The factoring company then collects the money from the invoices when they become due. It's really been a win-win for what we do."

"That's interesting. I wonder if you could you explain a little further just how factoring has helped your company?"

RM: "Sure, instead of having to wait up to 60 days before we could collect on the invoices, we were able to have the cash on hand immediately to purchase some new equipment and hire some more people to expand our business. This meant that we could accept the new offers that other businesses were providing for us and not having to pass. I cannot say enough about how factoring really benefitted us when it came to expanding our business."

"So, it seems like factoring really paid off for you. Do you still use factoring today?"

RM: "Yes we do. Although for the most part we still cash our own invoices, whenever we need money quickly so we can buy some new equipment or expand our business a little further, we go back to the factoring company and cash in our upcoming invoices. It really has worked wonders for our company."

"Tell me, what would have happened if factoring was not an option?"

RM: Frankly, I don't know how we could be in the position we are today without factoring. In this business, you have to take advantage of new opportunities quickly because there are other companies out there who will step in if you don't. Basically, I don't think we would be anywhere near the company we are today if it had not been for factoring.

There is little doubt that Ray's company would not be where it was without oil service factoring that allowed him to expand his company when he needed. For those in the oil industry, having your invoices cashed immediately by factoring companies allows greater flexibility so you can grow your business a lot more quickly and take advantage of opportunities.